THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

[09:00:10]

(BEGIN VIDEOTAPE)

JAKE TAPPER, CNN ANCHOR (voice-over): In cahoots? News reports reveal that the White House enlisted top members of Congress to push back with the media against stories about the Trump campaign's ties to Russia, amid new calls for an independent investigation and the White House's continued crackdown on the free press.

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: And I want you all to know that we're fighting the fake news.

TAPPER: Plus, fresh blood? The Democratic Party chooses a new chairman.

TOM PEREZ, CHAIRMAN, DEMOCRATIC NATIONAL COMMITTEE: Donald Trump, we will not allow those values to divide America.

TAPPER: But did the Dems sideline Sanders supporters?

SEN. BERNIE SANDERS (I), VERMONT: It's time to take a reassessment of the purpose of where the Democratic Party is and where it wants to go.

TAPPER: You will hear live from Senator Bernie Sanders next.

And confronting Congress.

(BOOING)

TAPPER: Town halls getting so hot, some Republicans are backing out, as the former Republican House speaker suggests Obamacare isn't going anywhere.

JOHN BOEHNER (R), FORMER SPEAKER OF THE HOUSE: I shouldn't have called it repeal and replace, because that's not what's going to happen.

TAPPER: Can President Trump still get a plan through Congress? Plus, the best political minds will be here with insights on what happens next.

(END VIDEOTAPE)

TAPPER: Hello. I'm Jake Tapper in Washington, where the state of our union is in flux.

Democrats, wounds still fresh from their crippling losses, just elected a new chair of the Democratic National Committee, in the hopes of attempting to rebuild their party.

Former Labor Secretary Tom Perez won out over Bernie Sanders-backed Congressman Keith Ellison in what many saw as a proxy war between the Obama-Clinton wing of the party and the Sanders wing of the party.

But the two men put on a clearly united front, with Ellison accepting Perez's offer to serve as deputy chair of the party, and both setting their sights squarely on President Trump.

Senator Bernie Sanders will be here live with his reaction in just a few minutes.

But, first, let's get to the new boss himself, DNC chairman Tom Perez.

Mr. Chairman, thanks so much for joining us.

PEREZ: Please to be with you, Jake.

TAPPER: So, I know your voice is from...

PEREZ: Yes.

TAPPER: ... vigorous campaigning.

PEREZ: Yes.

TAPPER: So, nobody at home should sound any alarms.

PEREZ: Yes. Yes.

TAPPER: But I want to ask you, President Trump told CPAC on Friday that the Republican Party from now on will be the party of the American worker.

And, in November, President Trump carried white voters without a college degree, working-class voters, by a staggering 37 percentage points. What is your plan to win these voters back into the Democratic fold?

PEREZ: We lead with our values and we lead with our actions.

We talk to them about how, literally hours into the Trump administration, he was a fraud. He made it harder for first-time homeowners to buy a home hours into his administration. Days later, he made it harder to save for retirement. He nominates a justice -- a judge for the Supreme Court who wants to

eviscerate collective bargaining. When we lead with our values as Democrats, and talk about what we've done to make sure we're protecting Social Security, protecting Medicare, growing good jobs in this economy, if you want good jobs, elect a Democrat.

That's the message that we have to communicate. It's a message that is true. It resonates in every zip code. And that's what we're going to be doing all over this nation, leading with our values, leading with the facts.

And the facts are, Democrats grow the middle class, Democrats protect economic security. And we need to do a better job of communicating that message everywhere.

TAPPER: I know you're probably reluctant to criticize Hillary Clinton, but are you of the opinion that her campaign did not talk about those economic values sufficiently, instead focusing on the perceived character flaws of the current president?

PEREZ: Well, certainly, we have to do a better job, as a Democratic Party, of messaging what we stand for.

We have to make sure that we're out there everywhere talking about how we're the party of good job creation, we're the party of middle-class security, we're the party of inclusion. We believe our diversity is our greatest strength.

And when we lead with these values, I believe we succeed, because those are the values of the American people. That's why you see millions of people out there marching in the aftermath of January 20, saying, Donald Trump, you don't stand for our values.

That's why you see, for instance, yesterday in Delaware, there was a big election for a state Senate seat. And it would -- it was a seat that held the state Senate in the balance. And it was a great example of that activism we have seen, Jake, coming into fruition, our revolution.

The DNC, grassroots activists came in to help elect Stephanie Hansen by a whopping 16 percent. This is the definition of the DNC and the Democratic Party coming together to make sure we help elect candidates from the statehouse to the senate to the school board.

And I am so excited about what happened there and yesterday in Delaware. We have got opportunities right here in Atlanta, where I sit today, Congressional 6, which is Cobb County. We're going to take the fight there.

[09:05:10]

TAPPER: Yes.

PEREZ: And people ask me all the time, Jake, how do you translate the energy out there, Tom, into action and results?

We did exactly that in Delaware yesterday. And we're going to work like heck to do that here in Georgia and elsewhere.

TAPPER: Sir...

PEREZ: It's very exciting to see the energy.

TAPPER: I want to ask you about a tweet from President Trump this morning about the DNC chair's race.

He wrote -- quote -- "The race for DNA chairman was, of course, totally rigged."

(LAUGHTER)

TAPPER: "Bernie's guy, like Bernie himself, never had a chance. Clinton demanded Perez."

I wanted to give you an opportunity to respond.

PEREZ: Well, you know, Congressman Ellison and I got a good kick out of that, Donald Trump up again in the morning tweeting about us.

You know, our unity as a party is our greatest strength. And it's his worst nightmare. And, frankly, what we need to be looking at is whether this election was rigged by Donald Trump and his buddy Vladimir Putin.

And I'll tell you, having Jeff Sessions oversee such an investigation, it's really unfair to any foxes across America to say that would be the fox guarding the henhouse.

We need an independent investigation, because that is a serious, serious issue. And the American people need to understand whether the Russians, in cahoots with the Trump folks and others, rigged the election.

And when Sessions and Flynn are out there together campaigning, they clearly lack the authority and the objectivity to conduct that investigation. So, we need an independent investigation.

TAPPER: All right, chairman Perez, thank you so much. And congratulations, sir.

PEREZ: Great to be with you.

TAPPER: So, let's turn now to former Democratic presidential candidate Bernie Sanders, who backed Perez's opponent and now the deputy chair of the DNC, Keith Ellison.

Senator Sanders, thanks so much for joining us this morning.

SANDERS: My pleasure.

TAPPER: So, let's start with yesterday's big vote at the DNC.

You obviously strongly backed Congressman Ellison. He lost the race to former Labor Secretary Tom Perez. You issued a statement saying -- quote -- "At a time when Republicans control the White House, the U.S. House, U.S. Senate and two-thirds of all statehouses, it is imperative that Tom Perez understands that the same-old, same-old is not working."

So, Senator, did the same-old, same-old win?

SANDERS: Well, look, Keith ran a great campaign.

He took on, in essence, Democratic insiders, and yet he came close to winning. That was a very impressive effort, when you realize that he was playing inside the establishment's house.

But, right now, I think, Tom Perez, who was a very, very good secretary of labor, has a real opportunity in his hands. And I hope he seizes it. And that is to understand that, in fact, the way the Democratic Party has been run for decades has not worked.

We need a total transformation. We have got to open up the party to working people, to young people, and make it crystal clear that the Democratic Party is going to take on Wall Street, it's going to take on the greed of the pharmaceutical industry, it's going to take on corporate America that is shutting down plants in this country and moving our jobs abroad.

The idea that Trump thinks that the Republican Party is going to be the party of working people, when he has appointed people to his administration who want to cut Social Security, want to cut Medicare, want to cut Medicaid, or who want to provide a budget which will give huge tax breaks to billionaires like Trump, and then cut back on education and health care for the American people, if that's a party that stands for working people, God help us all.

TAPPER: Senator...

SANDERS: So, I think our job now is to rally the grassroots to take Trump on and to fight for a progressive agenda.

TAPPER: Well, you saw President Trump's tweet suggesting that the system was rigged against Keith Ellison, in the same way that the DNC system was rigged against you in the primaries.

Does he have a point?

SANDERS: No, he doesn't have a point.

That's what the system is. And one of the things that Tom is going have to change is to figure out how we elect national Democratic leaders. I'm not quite impressed with the process that now exists.

But the bottom line here right now is that, yesterday, among other things, there were 150 rallies all across this country, most of them in front of Republican congressional offices, where citizens of this country are telling their members of Congress, have the guts to come out and meet with us. Explain to us why you're going to repeal the Affordable Care Act, throw 20 million people off of health insurance, do away with preexisting conditions. Don't hide. Don't simply run to your wealthy campaign contributors. Talk to your constituents.

And you are seeing that movement, millions of people engaged. We are going to transform this country.

Are you going to give your list to the Democratic National Committee, so that you can help them become more grassroots?

SANDERS: We are going to do everything that we can -- and we have started that progress -- to transform the Democratic Party into a party that stands up for working families.

And we have and will strong -- strongly support those candidates who are going to take on the issues of income and wealth inequality, they're going to take on the greed of the pharmaceutical industry, those people who want to make public colleges and universities tuition-free, who understand, unlike President Trump, that climate change is real and that we have got to transform our energy system.

So, we are going to work to support progressives who are running for the Senate, who are running for the House, who are running -- and Tom Perez made this point -- for school board, for city council, for state legislature.

I'm right now in Kansas. Last night, we had 5,000 people coming out in Topeka, Kansas. Kansas is not a Democratic stronghold. But we're beginning to see an activation here in Kansas and in states and communities all over this country, people who are prepared to take on Trump. People are prepared to fight for progressive change.

TAPPER: That sounded like you were saying that you're going to keep your e-mail list to support the candidates that you think are progressives, and you're not going to give it to the Democratic National Committee.

Did I interpret that incorrectly?

SANDERS: Well, where we are right now is that we are going to support and have supported and will continue to support those candidates who have the guts to stand up for working families and take on the big money interests, the people around Donald Trump.

You know, I have got to -- Jake, when you talk -- when President Trump talks being the party of working people, man, he has certainly put together an administration of working people. He has more billionaires, more millionaires in his Cabinet and his administration, any president in history. He has appointed people who are going to decimate the needs of the elderly, the children, the sick, and the poor.

So, what we are going to do is support those candidates who have the guts to stand up to the 1 percent and fight for the 99 percent.

TAPPER: OK. I think my interpretation was correct.

But let's talk about that, that you're talking about right now. President Trump said at CPAC on Friday that he likes you, because he says you are right on trade.

And take a listen to what the president's top adviser, Steve Bannon, had to say about the Trans-Pacific Partnership, that trade deal with Asian countries that you vehemently opposed.

(BEGIN VIDEO CLIP)

STEVE BANNON, WHITE HOUSE CHIEF STRATEGIST: I think one of the most pivotal moments in modern American history was his immediate withdrawal from TPP.

(CHEERING AND APPLAUSE)

BANNON: That got us out of a -- got us out of a trade deal and let our sovereignty come back to ourselves.

(END VIDEO CLIP)

TAPPER: I know that you disagree with many aspects of the Trump- Bannon agenda. And you disagree with Goldman Sachs executives, et cetera, in the administration.

But when the president talks about fair trade and economic nationalism, and Steve Bannon does as well, does that strike a chord with you at all?

SANDERS: Well, what strikes a chord with me -- and I have been on this issue well before President Trump was.

We have had a series of trade agreements in this country, NAFTA, CAFTA, PNTR with China, and the TPP, that were written by big money interests, to the detriment and the harm of working people.

We have lost millions of decent-paying jobs over the last 25 years through trade agreements that were written by corporate America that benefited corporate America.

So, I -- the devil is in the details as to what Trump is going to do. What we need is a fair trade policy, not an unfettered free trade policy. Trade is a good thing, but it's got to be fair to the American workers, not just the CEOs of large multinational corporations.

TAPPER: America's governors are having dinner with President Trump tonight. What message might they have for him? New Jersey Governor Chris Christie swings by on his way to the White House.

Oh, and, look, there's -- there's the smartest person in New Jersey right next to him, his wife, Mary Pat.

He, not she, will be on set with me next.

(COMMERCIAL BREAK)

[09:18:00]

TAPPER: Welcome back.

Can the Republican Congress be trusted to lead an investigation into whether the Trump campaign colluded with Russia?

That's the question Democrats are raising after a new revelation that the chairmen of the both the House and the Senate Intelligence Committees investigating that very issue were enlisted by the White House to try to convince reporters that stories connecting Trump campaign advisers to Russians known to U.S. intelligence were not true.

Now, the top Democrat on the Senate Intelligence Committee now says he has -- quote -- "grave concerns about what this means for the independence of this investigation" -- unquote.

Meanwhile, Republican Congressman Darrell Issa, of all people, is calling for a special prosecutor to investigate this potential Trump tie to Russia.

(BEGIN VIDEO CLIP)

REP. DARRELL ISSA (R), CALIFORNIA: Cannot have somebody, a friend of mine, Jeff Sessions, who was on the campaign and who is an appointee.

You're going to need to use the special prosecutor's statute and office to take -- not just to recuse. That's -- you can't just give it to your deputy. That's another political appointee.

(END VIDEO CLIP)

TAPPER: We asked the White House to provide us with a guest to discuss these developments.

The White House declined our offer, which is just as well, because here with me is the Republican Governor of New Jersey and former top Trump adviser Chris Christie.

It's always a pleasure to have you.

GOV. CHRIS CHRISTIE (R), NEW JERSEY: Happy to be here.

TAPPER: Do you agree with Darrell Issa that a special prosecutor is needed? CHRISTIE: No.

TAPPER: Why not?

CHRISTIE: No, I don't, because the Justice Department, over the course of time, has shown itself, with the professionals that are there, to have the ability to investigate these type of things.

I just think, Jake, -- and this is whether you're a Republican or a Democrat. We've seen it happen on both sides. When a special prosecutor gets involved, the thing gets completely out of control.

And I think that doesn't serve anybody's purposes. We have a lot of important problems to deal with in this country. And this is -- I'm not saying that is not one of them, but I believe the Justice Department can handle it.

TAPPER: Well, let's talk about the fact that White House Chief of Staff Reince Priebus reached out to the FBI to try to get them to tell reporters to issue a statement saying that "The New York Times" and CNN stories about the fact that the FBI was investigating these contacts was not true.

As a former U.S. attorney, you must think that that is somewhat troubling that somebody tied to the people being investigated reached out to those doing the investigation and said, hey, would you give us -- would you -- basically, would you give a public relations statement on our behalf?

[09:20:05]

CHRISTIE: Well, I come at this, as you mentioned in your question, from a totally different perspective than maybe some others.

TAPPER: That's right.

CHRISTIE: When the FBI says anything to you -- and if -- if the story is to be believed as it was put forward, it was the FBI that first approached the chief of staff.

TAPPER: Right. The deputy said something about the story not being true.

CHRISTIE: Right.

And so, first off, I think the assistant director of the FBI has to be spoken to by Director Comey. He shouldn't even be initiating that kind of conversation, in my view. And if I were the U.S. attorney, and that was an FBI agent or leader under my charge in the Newark or Camden offices, I would have sat them down and said, you're not to have those kind of conversations with people who could be in the orbit of an investigation, because you never know where an investigation is going to go.

I think I bring a different sensibility to it. If I were sitting in that position, I just would say, you know what, talk to Don McGahn about that.

TAPPER: The White House counsel.

CHRISTIE: Right. If you got something to say about that, talk to the White House counsel about it, out of an abundance of caution.

Now, I don't think that Reince thought he was doing anything wrong. I really don't. And I have an absolute confidence in his integrity. But you need to have the sensibility of a prosecutor when you're dealing with these issues, because perception matters.

TAPPER: OK.

And that's fair enough when it comes to the deputy director of the FBI, but what about the White House reaching out to the FBI to get a statement that would help them with this public relations matter about whether this was being investigated and reaching out to the House and Senate chairmen of Intelligence Committee?

If you had been in that room, I have a tough time imagining you saying, oh, yes, Reince, great idea. Reach out to the FBI, reach out to the chairmen of the Intelligence Committees. Try to get them to do your P.R. shop work for you.

CHRISTIE: Well, I think part of the problem here, though, Jake, is that we set up an atmosphere where you saw the reaction from -- from the Democrats, saying that, somehow, this takes these two really, I think, bright and distinguished people in the Intelligence Committee chairs and somehow disqualifies them from being able to run a good investigation.

I think that is absolutely untrue. And this is why the Democrats have lost two-thirds of the statehouses and the White House and the House and the Senate, because they overreach all the time.

Now, what we should do here is take a deep breath and be able to look into these matters in a way that the American public will think has integrity to it.

And so, from my perspective, it's that the Democrats are a problem in overreaching on this stuff. And the sensibilities need to be tightened a little bit at the White House as well.

But, remember, these are all people who have never been in government before. And so they're going to need to learn these things. And I don't think you get the learning curve just by winning the election. You develop experiences over time which tell you that.

I can guarantee you this. I don't think the chief of staff will ever have that kind of conversation with the FBI, with an FBI personnel again, nor should he.

But, again, Reince Priebus has great integrity. I don't think he did anything wrong. But I do think that it's something that perception matters, and we got to try it differently. TAPPER: Do you think that President Trump is poorly served by the

fact that there is no one in his inner circle who has ever run a government before?

You have now run the state of New Jersey for seven years. Experience comes with that experience, with that -- with those times learning lessons and figuring out how government works.

You're now talking about Reince Priebus learning on the job, he will never make that mistake again. That's great, but he already did make it. And that is going to cloud Richard Burr. It is going to cloud the FBI, et cetera, to some people.

Does President Trump need somebody around him who's run a government before?

CHRISTIE: Well, listen, I think the president needs people he's comfortable with.

I mean, most importantly -- and I know this as a chief executive -- if you don't have trust in the people who are sitting around the table advising you, no matter what experience they have, you're not going to listen.

So, in the end, these are the president's calls to decide, who will best serve him? And I think that that's his decision to make. And anybody -- any of us sitting on the outside to try to tell you need to have this or you need to have that -- I have known Donald Trump for 15 years -- he's not going to take that kind of advice.

What he wants are results. And the folks around him are going to have to start producing results for him that he then can say to the American people, we're getting the job done.

If that happens, no one is going to care about the issue of experience. If it doesn't happen, they will.

TAPPER: I'm sure you saw the president's tweets this morning attacking "The New York Times," attacking the DNC.

I have heard from Trump supporters in the last week or so who have expressed dismay to me because they see the president, in their view, addressing issues that have to do with his personal grievances, and not as engaged, at least on the -- on a superficial level, with the issues that will make a difference in their lives, jobs, trade, fighting ISIS, et cetera.

I don't know if you have heard from people like that. I imagine you probably have, because you talk to a lot of people.

CHRISTIE: Yes.

TAPPER: What do you tell Trump voters who say he seems engaged in his feud with "The New York Times," he doesn't seem engaged in what I voted for him for? CHRISTIE: What I tell them is, you don't know Donald Trump. He barely sleeps. And so he can engage on a lot of different fronts, on a lot of different battles at the same time.

And to say he's not engaged in issues that matter is just wrong. He's had multiple meetings with CEOs, manufacturers, all kinds of people around the country to talk about jobs, went to Boeing in South Carolina, engaged with them as well, is engaging on ISIS, has sent an executive order out that says, I want a plan to be able to take on ISIS and defeat them.

[09:25:06]

He's done much in these first 40 days or so, Jake, that have been on the substance on executive orders. Some people agree with him, some people don't, but you can't say they're not substantive.

Now, he also has his other battles, like you just talked about. The amazing thing about Donald Trump that I have learned over the years is that he can engage in all these battles, and, in fact, it energizes him.

He likes a fight. I think we have all seen that. And when he engages, no matter whether it's with "The New York Times" or ISIS, whether it's with CNN, or whether it's with the people who are exporting jobs out the United States, it energizes him.

This is a guy who doesn't need a lot of sleep. And, as you can tell from the way he uses modern technology, that fact is being proven even when he's in the White House.

TAPPER: Lastly, sir, there are a lot of angry town halls we're seeing across the country. I have to say, I don't know anybody who has taken -- has done more town halls than you.

Who do you say to congressmen, senators who are afraid of these angry crowds and either canceling or not even scheduling town halls?

CHRISTIE: Welcome to the real world of responsibility.

I said to some folks the other night that, for the first time, I hear members of the House not complaining when people don't know who they are. And that's on both sides of the aisle. And it's happened on both sides of the aisle.

The fact is that, right now, the heat is on the Republicans. It's on us. And I said this at a meeting of the governors yesterday, that we asked for authority to change the country. We now have two-thirds of the statehouses in America. We have the House. We have the Senate. We have the White House.

It's now on us to produce results. And one of the things that we need to do is engage with the public. Now, we understand that a lot of these protesters are professional protesters, people with an agenda, OK? But you got to work through that. And you got to stand up, let them

yell themselves out. In New Jersey, if I walked away from every town hall where I got yelled at, I would have never done one.

TAPPER: How many have you done?

CHRISTIE: I have done over 160 town halls during my time as governors.

TAPPER: Were some of those people professionals? Were some of those people...

CHRISTIE: Sure, the unions, teachers union in particular, sent lots of people with T-shirts and signs that were premade and that were taking me on a big way and in an inaccurate way.

And I understand why members of Congress don't like it. But you know what? You asked for the job. Go do it.

TAPPER: Governor Chris Christie, always good to see you, sir. Thank you so much.

CHRISTIE: Thanks, Jake.

TAPPER: They battled over who should lead the party, but the Democrats seemed to be able to agree on only one thing: They don't like President Trump.

Is that enough to reenergize their voters?

We will talk about that next.

(COMMERCIAL BREAK)

[09:31:38]

(BEGIN VIDEO CLIP)

PEREZ: And they're going to ask the question of all of us, where were you in 2017 when we had the worst president in the history of the United States? We will all be able to say the united Democratic Party led the resistance.

(END VIDEO CLIP)

TAPPER: That is newly elected Democratic Party chairman Tom Perez with some strong language as he takes the reins to lead the oppositions against President Trump, but will it translate to votes?

With me now an all-star panel. Former Republican presidential candidate Rick Santorum, from the Great Commonwealth of Pennsylvania. Former Democratic governor of Michigan Jennifer Granholm, Republican Congressman Mark Sanford of South Carolina, and Democratic Congressman Ruben Gallego of Arizona. Thanks one and all for being here.

Governor, let me start with you. You were a supporter of Tom Perez. As you know, there are Ellison supporters, Sanders supporters, who feel like the fix was in and that there was a smear campaign against Ellison. What do you say to that?

JENNIFER GRANHOLM (D), FORMER MICHIGAN GOVERNOR: There was definitely no smear campaign. But what we saw and as Tom Perez said to you, and they're actually legitimately friends. And what Tom did in his first act, which was to say essentially bring Ellison up by acclamation, make him the deputy chair was a great expression of unity, a great expression of generosity on Tom's personal part, but I think it wasn't hard for them because they are good friends. Now it's going to be up to both of them to make the case to the Sanders supporters and to those who supporter Ellison that we are better united.

As Ellison said himself, we don't have the luxury of walking out of that room yesterday in Atlanta being divided. We have a lot of work to do and it starts with healing.

TAPPER: But I'd have to say, congressman, with all due respect you heard Senator Sanders this morning he didn't exactly deny that he thinks Tom Perez is the same-old, same-old as he had said in his statement. He's not going to hand over his mailing list to the DNC. He's going to keep it and back the progressive candidates he wants to. It seems like there still is going to be something of a rift.

REP. RUBEN GALLEGO (D), ARIZONA: I think at the end of the day we have to really look at the fact that we really brought the two best candidates need to be the head of the party.

You know, Tom Perez is really bringing in the labor aspect of the Democratic Party, a group of voters that need to get back, also Latinos. You know, he is the first Latino DNC chair in the history of Democratic Party, a growing demographic that really over performed last time. Now we have Keith that's joining in within the DNC leadership (INAUDIBLE) progressives. Now the idea of emails or no emails being there I think at the end of the day that's going to be irrelevant.

We really see the excitement that's happening. We have a candidate down in Georgia who has raised $1 million just online, in a district that is traditionally a Republican district. So we know that the elements of the progressive movement are going to come back into the fold, into Democratic Party, and they're going to energize it. We're going to be stronger for it.

TAPPER: Senator Santorum. You were talking about the possibility of attracting these white working class voters before Donald Trump even really even thinking about running for president. You wrote a book about it in fact. Do you think that the Democrats can put them back in play?

RICK SANTORUM (R), FORMER PRESIDENTIAL CANDIDATE: Yes, the problem with -- the problem with that is that the Democratic Party has become the party of Bernie Sanders, I mean they are the progressives. That's who control.

I mean, to say there is a substantive difference between Perez and Ellison, there is no substantive difference. I mean, it was a style that (INAUDIBLE) sort of connection difference. But on the philosophy this is Bernie Sanders' party. And as striking as the Republican transformation under Trump is. It's even more striking in my opinion from a policy point of view, the transformation of the Democratic Party to be really the party of a Vermont socialist, who has -- who has been out there on the far reaches of the Democratic Party, now is the central figure in their party.

[09:35:13]

That to me is something that's really remarkable.

GRANHOLM: But wait a second. Aren't you the person who was talking about making sure that trade is fair? I mean, aren't you raising the -- haven't you been raising these same issues? You and I have both been raising these same issues.

So Bernie Sanders has been raising those issues too. That economic core issue is a Democratic issue, you can brand it all you want, but you've been raising that issue too.

SANTORUM: Well, if I've been raising issues it's not a core Democratic issue. Obviously it's something I've been raising and if you recall the last president to put in tariffs was George W. Bush who put in steel tariffs. So -- no, this is not --

GRANHOLM: But you're in alignment with Bernie Sanders --

(CROSSTALK)

SANTORUM: On the issue of trade -- on the issue -- on the issue of trade we -- there is alignment but on just about everything else there isn't much.

REP. MARK SANFORD (R), SOUTH CAROLINA: I would just say this, leaving trade aside, which is going to be interesting here and I hear consistently from voters back home, is what Carville talked about, it's the economy, stupid, it's the economy, stupid, it's the economy stupid. And the (INAUDIBLE) that I hear a lot of Republicans versus Democrats in back home is too much about redistribution of wealth for Democrats, want to look more at the creation of wealth. I think they got to get out of the pickle and it's going to be interesting.

TAPPER: You know, what I want to ask you about, congressman, the former speaker of the House John Boehner made headlines this week and when said, Obamacare is not going to be repealed and replaced.

Take a listen.

(BEGIN VIDEO CLIP)

JOHN BOEHNER (R), FORMER HOUSE SPEAKER: I shouldn't have called it repeal and replace, because that's not going to happen, it's basically going to fix the flaws and put a more conservative box around it.

(END VIDEO CLIP) TAPPER: Is that going to be good enough, what he's talking about?

SANFORD: Well, I mean, I think, I disagree with the hypothesis just to say if you look at actually the reconciliation bill it has got to be budget neutral which means you can't do all of Obamacare. But if you look at what it does in terms of penalties, if you look at it in terms of taxes -- I mean, it really -- I won't say guts, guts is not the right word. But it really, I mean, eliminates major portions of the Affordable Care Act.

This is not about putting a bow on something. This is (INAUDIBLE).

TAPPER: Congressman.

GALLEGO: The GOP really backed themselves into a corner here. For years and years they were talking about, you know, getting rid of Obamacare and now they have a problem. They don't know how to get rid of it while keeping the same -- the popular areas of it, including Medicare expansion, which is very important to -- a lot of GOP states have balanced their budget based on Medicaid expansion and the same time making sure to keep lifetime caps off. All these things are very popular.

If you start unraveling portions of the ACA you could pretty much create a shock to the insurance market, which would have horrible repercussions for them editorially. They just don't know how to do that right now.

GRANHOLM: In fact the governors who are here in D.C. right now for the National Governors Association, were just presented with a -- an objective report by McKenzie on the so called Republican plan. And that report, the plan which basically grant -- block grants is one potential, block granting to the state the money that they would be able to use to care of their -- for their population.

TAPPER: For Medicaid.

GRANHOLM: For Medicaid, and what that report says is that it would essentially cut millions of people off of health care and devastate state budgets.

So one way or the other, you either provide -- you either cut off populations of care to save money, you cut services to save money, or you cut the reimburses to help providers who will then drop out of the system. It doesn't work.

SANTORUM: Yes. The other big problem is there are things that can't change the reconciliation. Like preexisting condition, it's very popular.

You know right now we have -- the reality is today that thousands maybe approaching millions of Americans are paying nine months for insurance. Why? Because you pay for your insurance for nine months, there's a provision in Obamacare that says you can't be thrown off of your plan for three months. So you stop paying in September you can't get thrown off your plan until the end of the year, you have a right to guaranteed issue because no preexisting condition. And so you buy a new plan in January.

So people are paying nine months for 12 months of care and it's happening more and more, more as people get the gig (ph). Obamacare is a failure but you're going to need 60 votes to change preexisting conditions -- other things to make the system work and that's the problem of repealing and replacing, is you can't do it because it's a broken system.

TAPPER: The challenge, new questions about partisan meddling into Congress' investigation on President Trump and his campaign's possible ties to Russia. Can this be done fairly? We're back with the panel right after this quick break.

(COMMERCIAL BREAK)

[09:43:59]

(BEGIN VIDEO CLIP)

TRUMP: I want you all to know that we are fighting the fake news. It's fake, phony, fake.

(END VIDEO CLIP)

TAPPER: That was President Trump at CPAC deflecting from what he calls a fake news stories such as a "Washington Post" report that the Trump administration asked top intelligence leaders on Capitol Hill to go out and dispute the "New York Times" and CNN's reporting about the Trump campaign's contacts with Russia. These are the same Republicans leaders who were charged in some cases especially in the Senate side with investigating the issue right now.

The panel is back with me. Senator Sanford -- I mean, Congressman Sanford -- I'm giving a promotion there. Congressman Sanford, let me ask you, do you have any concerns about the fact that according to this "Washington Post" story, the White House reached out to the House and Senate intelligence committee chairman and said we want you to push back on these stories, which we believe are not true and they apparently did?

SANFORD: Right. I think we all would, but the question is does that disqualify them from mover forward? For instance, I mean, I don't think Dianne Feinstein wants to go any favors for Donald Trump. She's on the intelligence committee. You're looking about Mark Warner.

[09:45:00]

Mark Warner has raised questions. But at the end of the day there are six partisan Democrats on that commission. I think the best place to start is with the standing committees, and then if they find stuff, you could work from there the select committee, independent investigation et cetera, but I think you stick with the standing committees right now.

TAPPER: What do you think when you heard Congressman Darrell Issa call for a special prosecutor? SANTORUM: That was on the Bill (ph) Maher (ph) show (ph). Let's put it in context.

TAPPER: Well, he did say it.

SANTORUM: No, he did say it. No. Look, I think that the rush to a special prosecutor is always a dangerous thing. We've already usurped so much of the power of the Congress away from Congress. Let the Congress do their job. And as Mark said, it's a bipartisan -- the intelligence committee is bipartisan, it's not a -- it's not a partisan committee.

Let them do their job, let them -- let them investigate. I'm not at all concerned that Democrats and Republicans in looking at the facts won't come up with something that's very reasonable.

TAPPER: To play devil's advocate, the White House's perspective is, look, they were told by a senior FBI official that the "New York Times" and CNN reports were wrong and so they wanted to get that out there.

Is there anything wrong with that?

GRANHOLM: There is. I mean, I'm a former prosecutor as well and you just don't reach out to the people who are investigating, period.

But let me just say, you know, Sean Spicer, you talk about this fake news and of course he banned certain media outlets on Friday.

TAPPER: Including CNN and the "New York Times" on Friday.

GRANHOLM: Including CNN, right? And he had said in December that, when you ban media access it is a dictatorship. This is in December and of course he ends up doing that.

So you have to ask, what is going on underneath all of this? And truly, this question about them reaching out, whether it's to the FBI or to members of Congress to bat back stories, you know, citizens are like, well, what are they trying to hide? What's really going on underneath? This is why the issue of a special committee, or an independent committee, or a special prosecutor, something that is separate from both the partisans in Congress and the White House is critical.

And there's one other thing that's underneath all of this which is that Putin definitely wants a weak U.S. They would like to see a weak Europe. A Europe that's separated. That's why they're intervening in the European election.

TAPPER: Sure Germany and France.

GRANHOLM: And so for us and for our allies to get to the bottom of this because they are facing elections too, is critical. So for all of those reasons, an independent investigation is warranted.

TAPPER: Well, let me ask you, congressman, isn't that -- isn't that one of the issues that maybe Democrats don't have their eye on the ball? The ball is Europe, the ball is NATO and the E.U., and the more attention there is on Steve Bannon and the more attention there is on Mike Flynn, or whoever the less attention there is by Democrats on the fact that Russians right now according to people in the intelligence community are intervening in that election in Germany, in France.

GALLEGO: Well, they're all connected. You know, the same process they used to intervene with our election they're using in the elections in France and Germany. They're getting involved in even other countries right now.

So for us to investigate what happened here in a bipartisan matter and an independent matter is really important because it really has a connection that can tell where this is going. Look, if this had been a Democrat -- if this had occurred under a Democratic administration, there would have been a special prosecutor at this point. There would been like a 911 commission. The fact that it's not really shows the level of hypocrisy that's occurring within the GOP.

The oversight that's occurring is -- that should be occurring is not occurring, this is why you have leaks, this is why you have the intel community talking to the press, and this is why the White House is trying to discredit the press because today know more is coming.

TAPPER: Congressman.

SANFORD: I respectfully disagree with my colleague in that it is a given that the Russians want to have influence and they're flexing their muscles we can see that in whether it's in Estonia, whether it's in Ukraine, whether it's in Syria, and in other elections around the country. That's a given. We know that.

The question is, was there collusion with the Trump campaign? And I think whether Republican or Democrat, we want to get to the bottom of that. But starting with the select committee -- I mean, a standing committee given the fact that we're dealing with in many cases classified information, I think is by far the best way to start.

TAPPER: An amazing panel. I hope to have you all back again soon. Thank you so much.

GRANHOLM: Thank you.

TAPPER: Coming up, it's Hollywood's big night, is it also Hollywood's night attack President Trump? Who's planning to have a moment of at the Oscar's tonight and how will President Trump tweet? It's the "State of Cartoonion" next.

(COMMERCIAL BREAK)

[09:53:42]

TAPPER: All eyes will be on Hollywood tonight as the 89th Academy Awards are presented. And it's fair to assume that President Trump might be looming just as large on the red carpet and inside the arena as Oscar himself. And that is the subject of this week's "State of the Cartoonion."

(BEGIN VIDEOTAPE)

TAPPER (voice-over): It's probably a safe bet that President Trump will be watching the Oscars tonight ready to tweet his thoughts if anyone gets political.

TRUMP: I don't want the celebrities. I want the people.

TAPPER: One wonders how President Trump might have responded to previous Oscar political outbursts such as in 1973 when Marlon Brando sent Apache leader Sacheen Littlefeather to decline his best actor award for "The Godfather."

TRUMP: You don't have to go with Pocahontas. You don't have to go that far.

TAPPER: Perhaps President Trump would have paid Richard Gere complement for having taking on China's human rights abuses in 1993.

TRUMP: We're going to stand up to China.

TAPPER: But how would he have responded to Susan Sarandon and Tim Robbins taking the stage the same year protesting HIV positive Haitians who were barred from the U.S. being held down at Guantanamo Bay?

TAPPER: Would the president have gotten into a spat with Michael Moore after his speech railing against President Bush and the Iraq war in 2003, arguing misleadingly about who opposed the war first?

[09:55:00]

TRUMP: I was against the war in Iraq from the beginning.

TAPPER: All we know for sure is that with millions of people watching the president will be ready. Tweets ablazing for Hollywood's biggest night.

TRUMP: Look at these people. What a bunch of losers, I'll tell you. You are a loser.

(END VIDEOTAPE)

TAPPER: Make sure to stay with CNN for a huge political week. This Tuesday President Trump will make his first address to Congress. CNN will have full coverage beginning at 8:00 p.m. Eastern and then on Wednesday Senator John McCain and Lindsey Graham will participate in the next CNN town hall. That begins at 9:00 p.m. Eastern.